In the early American session, the industrial index or the Dow Jones, #INDU, is trading, below the ascending wedge pattern as well as below the 200 EMA and the 21 SMA. Strong downward pressure is observed, while the index is trading below the key level of 35,300.
The break of the reversal technical pattern is a signal that in the short term the index could fall to the 5/8 Murray support zone and to 34,375, the weekly pivot point level.
The fall in the performance of industrial stocks, which represents the engine of the Dow Jones, has reached a correction or overbought phase. So, the Dow Jones designated as #INDU could fall in the coming days.
While the Dow Jones is trading below the 21 SMA and below the 200 EMA, there will be a trend reversal signal with a bearish projection in the short term.
Consolidation from 23 Aug to 7 Sep below the strong resistance of 7/8 Murray has shown that the market has been exhausted in its attempt to make new highs. Now the market could enter a correction phase that will entail a change in trend.
Our outlook will continue to be bearish. Therefore, during a pullback towards the 35,300 level or below this point, we can sell with short-term targets up to 34,375.
Support and Resistance Levels for September 08 - 09, 2021
Resistance (3) 35,321
Resistance (2) 35,201
Resistance (1) 35,140
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Support (1) 34,926
Support (2) 34,784
Support (3) 34,532
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Trading tip for Dow Jones for September 08 - 09, 2021
Sell if pullback at 35,300 (SMA 21), with take profit at 34,765 (5/8), stop loss above 35,380.
Sell below 35,156 (EMA 200), with take profit at 34,765 (5/8) and 34,375 (4/8), stop loss above 35,220.
